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Essay Details:
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Essay text:
It would use a share of the excess capacity of Jell-O which is temporarily unused. So, the incremental cost of Super would be low. However, for a long term period, the Super project would not seem attractive anymore if the excess of Jell-O capacity did not exist. Super will disturb the production of Jell-O and need another machine investment to produce its own product.
Super was expected to get a 10% share of the total dessert market. Unfortunately, it would get the 20% of the expected share market from the erosion of Jell-O sales.
How did we evaluate the investment?
By calculating the payback period for Super project...
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